With consumer trust low, how can retailers keep their data safe?
With consumer trust low, how can retailers keep their data safe in light of high-profile breaches?
Over the past year, a variety of high-profile retailers have been hit by major data breaches, leading to the loss of details for millions of customers, writes Paul Thomalla. And whilst this seems to be increasingly in the media, it’s unfortunately nothing too new; take gambling website Paddy Power for example, which admitted just recently that hackers have stolen the personal details of more than 600,000 customers in a cyber-attack four years ago. So, it will likely come as little surprise that many consumers don’t feel that the data stored by retailers and other online shopping sites is secure against hacking attempts and data breaches.
Merchants are faced with ensuring they stay current and vigilant in every aspect of data security. Nonetheless, it’s not the proactive activities by retailers that often make the headlines; it’s the news that millions of pounds have been lost through breaches. Our recent consumer fraud research found that nearly a third of consumers globally (29%) don’t trust retailers with their data. So, how can retailers change this (perception)?
A good start would be making consumers aware of risk protocols. For example, articulating fraud management policies and procedures on a retail website and promoting security protocols at both online and bricks and mortar check-outs can go a long way in reassuring customers. It might sound obvious, but consumers want to feel confident that the retailers are taking every precaution to protect their personal and payment data when using in-store systems, online shopping carts, etc.
In the UK, the largest percentage of consumers believe theft by a computer hacker represents the greatest fraud risk (24%); this is followed by filling out paper forms that require card details (16%), shopping online (13%) and using card details to pay over the phone (13%). It’s promising to see that consumers are well aware of fraud dangers; it’s now up to retailers to demonstrate that they are committed to securing customer payment information.
Based on these research findings, there’s no doubt that retailers have some way to go in reassuring their customers against fraud; however, consumers also have a role to play. At minimum, they must keep an eye on their accounts and flag any activity that appears abnormal and immediately report transactions they have not made. The knowledge and technology is out there to keep payments safe and if consumers and retailers work together, I am confident that we can help keep fraud at bay.
 Paddy Power: hackers stole details of 600,000 users – The Daily Telegraph (31.07.14)